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The Average Apartment Size is Shrinking: 5 Things to Know

The Average Apartment Size is Shrinking: 5 Things to Know

As contemporary tenants are shifting their needs and demands, today’s housing market isundergoing tons of changes-and it’s impacting square footage. In order to accommodate thegrowing populations flocking to metropolitan areas, multifamily units are getting smaller inmajor cities all over the country.

The question on everyone’s mind is how this new trend will impact the commercial market.Here’s what investors, developers, and landlords need to know:

Urban Areas are Growing

So what’s the main cause of this sudden shift towards small? Expert analysts are saying it’s allabout location.

According to theNational Multifamily Housing Council’s Vice President of Research, CaitlinWalter, “(Multifamily units) are getting smaller. Part of that is where apartments are gettingbuilt.

”As growing cities around the U.S. are becoming hubs for business and technology, bigmetropolitan areasare expanding. Resultantly, they’re attracting new residents looking for jobs,education, and other opportunities within these thriving locations.

Bigger populations mean that the renters market is undergoing some growing pains. Theincreased volume of apartment hunters requires a boost in supply to balance out the spike indemand. The multifamily module is best fit to accommodate this shift as these assets are ableto house a large community within a tighter plot of land

It’s Focused on the New Developments

Don’t think that all apartment units are going to be downsized to fit into this trend.

The square-footage reduction will be most prominent within the newer developments that arecropping up. The existing multifamily buildings will be largely untouched while the up andcoming properties will be much, much smaller.

This relationship will create a massive disparity between the sizings of the multifamily units onthe housing market.

Where is the Space Being Cut From?

Bedrooms are taking the hit as square footage is being shaved off of these multifamily units.

Today’s developments are mainly harboring studios and two-bedroom units. The three-bedroomapartment is becoming a thing of the past as many projects are determined to squeeze themaximum number of units into their development module.

Smaller Units are Fueling Affordability

Fortunately for students and members of the workforce, living in cities is becoming moreaffordable-thanks to the widespread downsizingof apartments. With more single and doublebedroom units available on the market, the price points are correspondingly adjusting.

The Wrap Up

All in all, it’s important for everyone involved with the multifamily industry to be aware thatapartment unitsare being downsized.

Investors and developers should note that this trend is responding to a tenant demand. Thesmall apartment module is meeting a need for smaller and more affordable housing optionswithin crowded cities around the United States. Newmultifamily properties can benefit byresponding to this trend which has the power to attract tons of tenants.

However, it also means that bigger apartments will be in short supply amongst newly developedbuildings. That said, appealing to the opposite market can come with its fair share of benefits.Families with children will likely need larger apartments for their metropolitan homes, sosupplying that can be incredibly prosperous.

Multifamily landlords and property managers should be ready to handlethe influx of tenants.With smaller units, buildings will have more individual residents-which can have a huge impacton day-to-day management responsibilities.\

These 5 points will keep you ahead of the game. Don’t forget to include these within yourupcoming CRE strategies.

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